US STOCKS-S&P 500 heads for worst first quarter since 1938

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* Energy stocks gain on higher oil prices
* Dow set for worst first quarter ever
* Carnival slumps on plan to raise debt, suspend dividend
* Indexes up: Dow 0.18%, S&P 0.02%, Nasdaq 0.66%

(Updates to open, adds comment)
By Uday Sampath Kumar and Medha Singh
March 31 (Reuters) - U.S. stock markets steadied on Tuesday
at the end of the worst first quarter for the S&P 500 since 1938
amid growing evidence of the largescale damage caused by the
collapse in oil prices and business activity due to the
coronavirus.
Real estate stocks .SPLRCR , utilities .SPLRCU and
consumer staples .SPLRCS - commonly considered defensives -
led declines following a rebound sparked by bargain hunters
looking for stocks likely to weather an economic slump.
Another set of gains for Facebook Inc FB.O , Amazon.com Inc
AMZN.O , Apple AAPL.O , Netflix Inc NFLX.O and Google-parent
Alphabet Inc GOOGL.O , known as the FAANG group of stocks,
helped the Nasdaq jump 1% on Tuesday.
"Stocks have been on a wild ride ... (and) not surprisingly,
investors are split on whether to lean in to or fade the current
rally," said Jonathan Golub, chief U.S. equity strategist at
Credit Suisse Securities in New York.
An unprecedented round of fiscal and monetary stimulus had
helped equity markets stabilize last week following wild swings
that sent the benchmark S&P 500 up 9% one day only to slump 12%
in the next session.
Wall Street's volatility index .VIX has retreated from
12-year highs, but is still at levels rarely seen since the
global financial crisis as the outbreak deepens in the United
States and disrupts supply chains.
Sliding from the record highs of mid February, the Dow Jones
and S&P 500 indexes are now set to end the quarter more than 18%
lower from the start of the year.
The declines have erased more than $5 trillion from the
value of S&P 500 firms in the first quarter, and investors fear
corporate defaults and more mass layoffs going in to the second
quarter.
The blue-chip Dow is on course for its biggest quarterly
percentage decline since 1987 and the tech-heavy Nasdaq is set
to close out its worst first three months of the year since
2008.
"While the majority of people want to remain optimistic that
we've seen the lows ... that optimism is merely based on a lot
of hope," said Michael James, managing director of equity
trading at Wedbush Securities in Los Angeles.
At 10:17 a.m. ET, the Dow Jones Industrial Average .DJI
was up 39.30 points, or 0.18%, at 22,366.78, the S&P 500 .SPX
was up 0.54 points, or 0.02%, at 2,627.19. The Nasdaq Composite
.IXIC was up 51.60 points, or 0.66%, at 7,825.75.
Shares of Carnival Corp CCL.N , already by hammered by
plunging global travel demand, tumbled 12% after it said it was
raising about $6 billion in combination debt and equity and
suspend its dividend payouts. The energy index .SPNY jumped 4%, boosted by a rebound in
prices from 18-year lows after the United States and Russia
agreed to discuss stabilizing energy markets. O/R
Advancing issues almost matched decliners on the NYSE and on
the Nasdaq.
The S&P index recorded one new 52-week high and no new low,
while the Nasdaq recorded seven new highs and 13 new lows.